US state and local governments reported over 7.59 trillion in liabilities in 2020, an amount that exceeds their annual revenue and is equal to about 30% of Gross Domestic Product. Reason Foundation computed this total and its subcomponents by reviewing 30,000 audited government financial statements filed by state and local governments for their 2020 fiscal year.
The dataset was queries from the database on Feb 8.
These ratio values were calculated:
* "Liabilities/Revenues Ratio" = total_liabilities/revenues,
* "Bonds Outstanding/Revenues Ratio" = bonds_outstanding/revenues,
* "Net Pension Liability/Revenues Ratio" = (net_pension_liability - net_pension_assets)/revenues,
* "Net OPEB Liability/Revenues Ratio" = (net_opeb_liability - net_opeb_assets)/revenues,
* "Compensated Absences/Revenues Ratio" = compensated_absences/revenues,
* "netted_net_pension_liability" = net_pension_liability - net_pension_assets,
* "netted_net_opeb_liability" = net_opeb_liability - net_opeb_assetsGovernmental Accounting Standards Board Statement 68 requires governments to report underfunding of their defined benefit employee pension plans as a “Net Pension Liability”, and any overfunding as a “Net Pension Asset”. A single government entity may participate in multiple pension systems with varying funded status. If a government participates in one or more underfunded systems and one or more overfunded systems, it will report both a Net Pension Liability and a Net Pension Asset. For purposes of this study, reported assets are netted against liabilities to determine a governmentwide net pension position. The accompanying table lists government entities with the largest net pension liabilities in absolute dollars net of any reported assets.
Table 1 – State and Local Governments Reporting Largest Net Pension Liabilities, 2020
| State | Entity | Net Pension Liability |
|---|---|---|
| IL | State of Illinois | 143,346,569,000 |
| CA | State of California | 92,089,623,000 |
| NJ | State of New Jersey | 90,812,068,247 |
| TX | State of Texas | 67,084,585,000 |
| NY | New York | 46,376,874,000 |
| MA | Commonwealth of Massachusetts | 41,643,152,000 |
| CT | State of Connecticut | 39,840,819,000 |
| IL | Chicago | 32,958,251,000 |
| IL | Rock Valley College District Number 511 | 28,720,071,173 |
| KY | Commonwealth of Kentucky | 25,870,784,000 |
Other post-employment benefits (OPEBs) refer to retiree health insurance, life insurance, and any other retiree entitlement aside from pensions. Health insurance accounts for the overwhelming majority of OPEBs nationally. For an in-depth discussion of OPEBs, readers are encouraged to consult Reason Foundation’s 2021 study of this topic.
After the implementation of Government Accounting Standards Board Statement 75, reporting of Other Post-employment Benefits generally parallels that of defined benefit pensions. A government may report either a “Net OPEB Liability” or a “Net OPEB Asset.” If it participates in a mixture of underfunded and overfunded OPEB plans, it may report both a liability and an asset, which are netted for purposes of this study. The accompanying table lists government entities with the largest net OPEB liabilities in absolute dollars net of any reported assets.
Table 2 – State and Local Governments Reporting Largest Net OPEB Liabilities, 2020
| State | Entity | Net OPEB Liability |
|---|---|---|
| NY | New York | 109,456,918,000 |
| CA | State of California | 90,486,960,000 |
| TX | State of Texas | 76,983,152,000 |
| NY | State of New York | 66,006,000,000 |
| NJ | State of New Jersey | 65,491,562,252 |
| IL | State of Illinois | 58,996,493,000 |
| CA | Los Angeles County | 25,921,499,000 |
| CT | State of Connecticut | 23,023,169,000 |
| NY | Metropolitan Transportation Authority | 21,117,000,000 |
| MA | Commonwealth of Massachusetts | 17,486,660,000 |
Most employers, both public and private, offer paid vacation and sick leave as well as personal days. Some offer other forms of paid leave such as sabbaticals for educators. Typically, employers provide specific numbers of paid vacation, sick, and personal days per year, although many do not differentiate between types of leave and simply offer a number of paid time off (PTO) days that can be used for any purpose. Depending on the employer, unused PTO days are either forfeited at the end of each year or can be accumulated by the employee. Employers who allow employees to accumulate PTO pay out the value of unused days off at the time of separation (due to retirement or other reason). Public sector employers are more likely to allow employees to accumulate sick leave. According to the Bureau of Labor Statistics, 58 percent of state and local government employees were entitled to carryover sick leave from year to year without limitation, compared to only about 12 percent of private sector employees. The BLS data does not address accumulation of vacation leave, but it does show that public sector employees receive slightly longer vacations than their private sector counterparts. Under government accounting standards, state and local governments must report the liability associated with accumulated, unused PTO. The accounting term for this liability is “compensated absences” and the rules for reporting it are set forth in Government Accounting Standards Board Statement 16. In 2020, GASB began a re-examination of its compensated absence policies.
Table 3 – State and Local Governments Reporting Largest Compensated Absences Liabilities, 2020
| State | Entity | Compensated Absences |
|---|---|---|
| NY | New York | 5,693,120,000 |
| CA | State of California | 4,401,397,000 |
| WI | State of Wisconsin | 2,593,896,000 |
| OR | SAIF Corporation | 2,253,391,000 |
| CA | Los Angeles County | 2,072,486,000 |
| TX | State of Texas | 2,035,843,000 |
| NY | State of New York | 1,358,000,000 |
| NY | Metropolitan Transportation Authority | 1,061,000,000 |
| CA | Los Angeles | 943,187,000 |
| WA | State of Washington | 910,960,000 |
| State | Entity | Bonds Outstanding |
|---|---|---|
| CA | State of California | 109,854,424,000 |
| NY | New York | 99,455,082,000 |
| TX | State of Texas | 59,721,954,000 |
| NY | Dormitory Authority | 58,215,000,000 |
| NY | Metropolitan Transportation Authority | 51,013,000,000 |
| MA | Commonwealth of Massachusetts | 41,939,680,000 |
| IL | State of Illinois | 31,531,895,000 |
| CT | State of Connecticut | 29,166,415,000 |
| CA | Los Angeles | 29,056,349,000 |
| WA | State of Washington | 26,732,746,000 |
| State | Entity | Total Liabilities |
|---|---|---|
| CA | State of California | 408,305,319,000 |
| NY | New York | 305,300,557,000 |
| IL | State of Illinois | 263,404,811,000 |
| TX | State of Texas | 250,250,365,000 |
| NJ | State of New Jersey | 213,903,087,870 |
| NY | State of New York | 188,872,000,000 |
| MA | Commonwealth of Massachusetts | 113,588,290,000 |
| CT | State of Connecticut | 97,821,884,000 |
| NY | Metropolitan Transportation Authority | 92,447,000,000 |
| WA | State of Washington | 84,090,857,000 |
Note: Only show Revenues >= 1000000
| State | Entity Name | Bonds Outstanding | Revenues | Ratio |
|---|---|---|---|---|
| IA | Tobacco Settlement Authority | 748,135,062 | 2,882,887 | 259.51 |
| OK | Muskogee Industrial Trust | 166,757,288 | 1,437,636 | 115.99 |
| OK | Rogers County Educational Facilities Authority | 52,180,000 | 1,416,005 | 36.85 |
| LA | Louisiana Public Facilities Authority | 116,611,681 | 3,862,243 | 30.19 |
| LA | City of Gonzales Industrial Development Board | 49,614,679 | 1,699,927 | 29.19 |
| OH | Jerome Village Community Development Authority | 71,528,926 | 2,691,552 | 26.58 |
| OH | The River South Authority | 59,734,336 | 2,254,118 | 26.50 |
| OK | Rogers County Finance Authority | 35,425,000 | 1,377,833 | 25.71 |
| IN | Indiana Bond Bank | 851,986,930 | 33,240,329 | 25.63 |
| OH | Ohio Water Development Authority | 5,248,829,688 | 214,314,695 | 24.49 |
| State | Entity Name | Net Pension Liability | Revenues | Ratio |
|---|---|---|---|---|
| IL | Rock Valley College District Number 511 | 28,720,071,173 | 171,503,108 | 167.46 |
| MT | Columbus School District No. 6 | 2,090,310,698 | 13,051,827 | 160.15 |
| SC | Cherokee County School Distirct 1 | 112,885,378 | 2,559,049 | 44.11 |
| NJ | Middlesex County Improvement Authority | 2,261,409,556 | 91,960,390 | 24.59 |
| CA | Southern California Public Power Authority | 1,566,611,000 | 65,685,000 | 23.85 |
| WA | Seattle | 1,471,420,000 | 64,030,000 | 22.98 |
| MO | Saline County | 221,083,491 | 11,195,433 | 19.75 |
| NJ | Brick BoardEducation Township | 2,374,577,840 | 167,842,868 | 14.15 |
| CA | Union City | 52,487,841 | 4,626,045 | 11.35 |
| IL | Wood Dale Fire Protection District | 53,704,832 | 6,653,479 | 8.07 |
| State | Entity Name | Net OPEB Liability | Revenues | Ratio |
|---|---|---|---|---|
| SC | Cherokee County School Distirct 1 | 91,170,845 | 2,559,049 | 35.63 |
| CA | Southern California Public Power Authority | 992,316,000 | 65,685,000 | 15.11 |
| WA | Seattle | 673,086,000 | 64,030,000 | 10.51 |
| NY | Massena | 82,887,248 | 14,828,163 | 5.59 |
| NY | Cobleskill-Richmondville Central School District | 230,266,120 | 44,700,555 | 5.15 |
| NY | Central New York Regional Transportation Authority and Subsidiaries | 385,283,876 | 75,303,412 | 5.12 |
| NY | Arlington Central School District | 1,009,500,307 | 219,657,517 | 4.60 |
| NY | Red Hook Central School District | 258,268,198 | 56,306,225 | 4.59 |
| NY | Spackenkill Union Free School District | 223,242,973 | 50,555,819 | 4.42 |
| CT | West Shore Fire District | 44,607,973 | 10,133,181 | 4.40 |
| State | Entity Name | Compensated Absences | Revenues | Ratio |
|---|---|---|---|---|
| NY | Long Beach | 31,759,000 | 99,487,552 | 0.32 |
| NY | Central Islip Union Free School District | 69,883,593 | 233,576,454 | 0.30 |
| NY | Glen Cove | 15,931,865 | 56,873,828 | 0.28 |
| NY | Cortland | 7,481,870 | 27,311,521 | 0.27 |
| NY | Nassau Community College | 53,992,035 | 204,824,429 | 0.26 |
| IA | Shelby | 721,284 | 2,983,886 | 0.24 |
| NY | Batavia City School District | 12,471,015 | 52,173,977 | 0.24 |
| PA | Highlands School District | 10,437,085 | 43,821,736 | 0.24 |
| NY | Grand Island Central School District | 14,181,000 | 62,305,363 | 0.23 |
| NY | Depew Union Free School District | 9,715,280 | 44,823,901 | 0.22 |
| State | Entity Name | Total Liabilities | Revenues | Ratio |
|---|---|---|---|---|
| GA | School District Dougherty County | 31,139,382,946 | 1,322,200 | 23,551.17 |
| IA | Tobacco Settlement Authority | 751,433,035 | 2,882,887 | 260.65 |
| OK | Muskogee Industrial Trust | 166,767,288 | 1,437,636 | 116.00 |
| ME | Richmond Utilities District | 507,841,204 | 11,713,404 | 43.36 |
| LA | City of Gonzales Industrial Development Board | 73,191,107 | 1,699,927 | 43.06 |
| PR | Puerto Rico Highways and Transportation Authority | 8,777,193,750 | 206,331,396 | 42.54 |
| TX | Harris County Municipal Utility District No 423 | 42,871,046 | 1,021,777 | 41.96 |
| PR | Peñuelas | 67,063,757 | 1,669,271 | 40.18 |
| OH | Jerome Village Community Development Authority | 105,690,321 | 2,691,552 | 39.27 |
| UT | Utah Telecommunication Open Infrastructure Agency | 461,216,203 | 12,098,508 | 38.12 |